Following the recently handed down decision by Justice Jagot of the Federal Court of Australia, Australian Health & Nutrition Association Ltd trading as Sanitarium Health Food Company v Irrewarra Estate Pty Ltd trading as Irrewarra Sourdough  FCA 592; café and health food shop owners around Australia may be breathing a healthy sigh of relief.
Food giant Sanitarium sued the Victorian based ‘Irrewarra Sourdough’ bakery for alleged infringement of registered trade mark No. 32227 “GRANOLA”, registered in respect of goods in class 30 (which includes preparations made from cereals), after the bakery sold packets of toasted nut, seed and oat mix labelled “all natural handmade granola”. Sanitarium uses the GRANOLA trade mark as part of its ”Granola Oat Clusters” breakfast food.
Whilst not the proprietor of the trade mark “GRANOLA”, Sanitarium is an authorised user of the GRANOLA mark in Australia [Australasian Conference Association Limited, the registered proprietor of the trade mark “GRANOLA” (and has been since 17 December 1921)].
In their submissions, Sanitarium contended that the word “GRANOLA”, which is widely understood in the United States to mean a crunchy toasted cereal, did not have the same meaning in Australia. Thus, they argued GRANOLA had instead a less descriptive meaning and should be rationed to be a ‘badge of origin’ due to the term GRANOLA possessing a more ‘’boutique’’ meaning in the Australian market. Accordingly, Sanitarium viewed that GRANOLA should be limited to its own brand of breakfast products.
The word GRANOLA was invented in 1876 in the USA to refer to a wheat and oat breakfast cereal ground into granules and baked, its derivation being “GRAN” (referring to grain) and the suffix “OLA” (said by the Oxford Dictionary Online to be “[u]sed to form nouns denoting commercial products (as Editola n., moviola n., Victrola n.)”), also sounding like the adjective “granular”.
Irrewarra Sourdough argued the use of the word was ”purely descriptive”. Jagot J agreed with the bakery, stating that the word as used by the Irrewarra Sourdough did not have any prominence on the cereal packet, which was dominated by the Irrewarra Sourdough bakery’s distinctive black-and-white sign.
The front labels on Irrewarra Sourdough products appear as follows, ordered from the earliest sign to the latest sign:
Jagot J ultimately rejected the submissions put forward by Sanitarium, and viewed that by the use of GRANOLA in the signs by Irrewarra Sourdough was not seen to be a use of the word GRANOLA as a trade mark. The use of GRANOLA was not to be viewed as being use as a ‘badge of origin’, but instead as a description of the contents of the package.
Jagot J also rejected the proposal that the word GRANOLA had only a limited meaning in Australia. Whilst not strictly necessary for full consideration in the present case, Jagot J held irrespectively that Irrewarra’s sign was not substantially identical with Sanitarium’s trade mark, nor was it deceptively similar to that same mark. The sign on Irrewarra’s product “all natural handmade granola” was considered not to “so nearly resemble the trade mark GRANOLA so as to be likely to deceive or cause confusion.”
This news will surely give relief to café and health food store owners who can now return ‘toasted breakfast cereals’ back to their menus without fear of potential infringement.